• silicon.com
• Technology
• Hardware

By Marguerite Reardon, 5 February 2009 12:01

NEWS be many times where a customer will pick Hyper-V and want to use EMC storage. And that's fine. We'll work together there.

I think it's an acknowledgment by two people that have great respect for each other, and two companies that are powerful, that this is a very good way to go.

Ballmer: There's enough shared interest for this to work. If it's 90 per cent, 95 per cent competition, it's hard to get the little bit of cooperation. We're nowhere like that. We're 80 per cent, 85 per cent cooperation, something like that. So, that makes it easier to do the whole thing.

Tucci: Good point.

Ballmer: I can't tell you we're "co-opetiting" or whatever you call it very well, for example, with Oracle. So, I'm not pretending you can do it with everybody in the business.

That leads to my next question. Partnerships in general are very tricky to manage, because, as you mentioned, you're cooperating but you're also competing in some areas. What are your companies doing to ensure that this partnership benefits each of your interests?
Tucci: Well, you're right. It's just like anything else in life. Whether it's a marriage or two people working together, it just takes time. Nobody is going to have exactly the same identical views, and it just takes time. You've got to work through them.

Steve and I dedicate time to having reviews very regularly. We have two people, very qualified people in the back of the room here, that work this alliance as a full time job. And we talk all the time. When things aren't right or something goes wrong - let's put it this way - we fix it. And when things are good, we celebrate it and do more of it.

That's what we're doing today, we're saying, "Okay, it's been so good, to Steve's point, the 85 per cent total cooperation is a really good number, we're going to extend this thing for three years." Steve and I are going to raise the bar. We want more success, and we're going to hold our teams accountable.

Ballmer: These things tend to go into one of three buckets. One, they break down, there's just too many problems, and sometimes that does happen to partnerships.

Number two, they're really largely irrelevant. That is, we kind of work together, but the partnership never really gets any energy. And we've had some of those, I would say.

And then the third case is where they really work. In the case with EMC, it definitely falls into the third category.

The thing that I wasn't sure about when we started - Joe was, I wasn't, and I give Joe credit for this - was would it really be important enough to the EMC salesperson and the Microsoft salesperson to matter? Because if it's important enough to matter, it's important enough to the customer. Then it also stays important enough to the R&D guy, and it is important enough.

When we go into sell an Exchange solution, we get to talk about storage, content management, and services along with the EMC people. So we're talking about things which are really important to both companies, and really important to the customer. The customer cares about what the deployment is going to look like; how highly available will that Exchange implementation be; what's the storage configuration going to look like. That's an important part of the overall decision-making process. And because it's important enough to the customer, I think that really helps.

I didn't know going in, I'm not a storage expert. Joe said, trust me. Joe and I have worked together 25 years now basically, in a co-opetition arrangement, pretty much the whole time. And I would say it has really worked.

Now, I know that you each have partnerships with Cisco Systems. But in particular, Steve, Microsoft has been competing more and more with Cisco. You mentioned that earlier. So where do they fit into what Microsoft is doing?
Ballmer: Well, there's three interesting dimensions. On their core business side, the networking side, we work together. But we never found a go-to-market activity to support that activity that's as powerful, for example, as the one we found with EMC. So, we've always cooperated, and we still do today. But it's never popped in the way this partnership does, which is an interesting difference. Our engineers work together, but our salespeople, by and large, don't work together.

On the unified communications side, which is the future of video, voice conferencing, collaboration, and communications, we're competing. We started out adding some voice and video and conferencing capabilities to our software. Cisco has gone further. They've bought some competitors in the e-mail and collaboration space. So, we compete, and that will be robust competition. And we'll live with that. So, it's got that dimension.

And now they've got this new business that I'm not sure anybody knows exactly where it takes them. They seem to want to jump in on the server business. We like to license Windows Server to people who sell servers. So, we're busy trying to make Cisco a good customer. But I'm not sure exactly where they go, where that takes them as they jump in and really go head-to-head with the HPs and Dells of the world. It's going to be a new thing for them, and I don't know what it has to do with their storage business really.

EMC and Cisco have partnered much more closely. There's even been rumours that Cisco might want to acquire EMC. Can you explain the relationship?
Tucci: Primarily our partnership with Cisco has been around their switches, which we've used in the storage environment on the storage area networking side, and, of course, on the network-attached storage side. We also resell their IP switch as part of our solution. So, we're a Cisco reseller, and that's gone pretty well for both